Eric Whobrey sits at the nexus of practical assessment & use of current construction technology, and investment in the future. Eric shares the frameworks for thinking about these two overlapping responsibilities, and how understanding the field makes for better investments. Overall a fantastic view of the current market for construction technology.
Follow Eric here: https://www.linkedin.com/in/ericwhobrey/
learn more about Arco/Murray here: https://www.arcomurray.com/
Eric Whobrey
Hugh Seaton: Welcome to Constructed Futures. I'm Hugh Seaton. Today I'm here with Eric Whobrey, director of technology and innovation at ARCO/Murray and managing partner of AM ventures. Eric, welcome to the podcast.
Eric Whobrey: Thanks Hugh, I'm happy to be here.
Hugh Seaton: Awesome. So I thought we might start with the innovation role first and sort of blend the two as we talk along the podcast that let's, let's start with what you do.
So how does your role work?
Eric Whobrey: Great question. So as the director of technology and innovation at a construction company, I think that that question is probably answered pretty differently across businesses because we don't really have a blueprint laid out for the best way for that to work in a construction company.
So the way that my group really works within Arco Murray is for the most part, we're serving as kind of an internal consultant to our different parts of the business about how to best apply technology as a solution to certain problems. And that may be happening internally, with different project teams. We focus heavily on the operating part of our business. That is the project managers, project assistant, superintendents on our construction work. But it's by no means limited to that. So we also work and consult with our marketing team, our HR team, our recruiting team. It really any, any part of the business that we think there's a problem that we can help solve, we're trying to get involved early and often in discussions around pains worth solving.
So my role there is to really employ the team that can, that can spend the time in the business, identifying the highest impact problem solution areas where we can really look at what can be done with tools that are in the industry. That may be softwares we can purchase off the shelf, what can be done to integrate existing core software that we already use, or if there isn't something out there, what can we build, that is a prototype that works for Arco that solves a problem for us and then can be iterated on and refined and eventually developed into a product that may work for the industry. But has that purview of does this really solve Arco's problem?
Hugh Seaton: Awesome. So, and there's a lot in there, so let's unpack it a little. When you think about how to discover the initial pain. I mean, a lot of times people are pretty, pretty able to tell you that, look, this is an issue for us. Can you help us?
Is that enough? Is that already filling your pipeline? Just, just once, once people know that they can call your team and say, Hey, I really wish we could estimate better or whatever the, whatever the specifics are is that already enough?
Eric Whobrey: To an extent, yes, it certainly keeps us busy in in collecting ideas.
But I when I started at Arco, I did not come from a construction background. So I think there was a learning curve on my end of how the construction industry works. What problems are the biggest problems? How we really operate internally because coming from the technology world I had that information in spades. You know, I could see a problem and apply a technology solution to it, but where I think I've had to learn and where I encourage my team to continue learning on is how those things meet, where it's not just technology solving problems.
And it's, it's also not just construction people having the best ideas on how to solve problems. It's really somewhere in the middle there where we're all kind of trying to elevate our level of education. Both on what's being done in the field or in our office. And how technology can be applied to that that we start to bubble those high priority things to the top.
So I think to simply answer your question, just getting the pains is not enough. Understanding the pains and really seeing how they kind of tie into the whole process of designing and building things is where we've been able to grow and be most valuable to our internal teams and to the external market too.
I think there's a lot to be learned there that should be shared, which is why we have conversations like this. And we tried to kind of meet with our peers in the industry too, and share those experiences and get a good idea of, of how people are solving them.
Hugh Seaton: Yeah. And, and I, so a kind of a corollary of that then is. If it isn't just someone calling and saying, this is, this is a pain for us and we need to fix it. Obviously that's a huge component, but how else do you estimate or prioritize what's really gonna make a difference. Cause again, to the person who's calling you, this is the most important thing of their day.
Eric Whobrey: It is. And I often say both internally and externally we're oftentimes not dealing with a technology problem. We're dealing with communication, education and empathy problems. So it's really trying to package something up into a complete idea of a project so that we have a clear beginning and end.
And we can help to relay the importance and priority and scale of a problem to all those involved. So you're right. We get requests from people all the time. Our innovation team gets requests from someone that says, I need this and I need it yesterday. And what we've gotten really good at is quantifying that problem beyond just that individual's pain.
So a lot of times it's back of napkin math, but we put it through a process where we suss out like how much time is really being spent on this problem, by how many people, how valuable is that to the company? And then much, can we reduce that if we pursue a solution.
Really doing that, that you unit economics of here's how it's being done now. And here's a dollar value we can apply to that and here's how much it will cost to solve. And then here's the resulting dollar value of the new way of doing it. That we can then take that back to the people with the pain and say, okay, compared to everything else we're dealing with this actually isn't that high on the list.
So we feel your pain and we're very excited to solve it, but understand that it's number six in the list of 10 things. And for those that are maybe unsure of how impactful their pain is, we see this in the opposite where they say, ah, it's not really that big of a problem. And then we bring them the unit economics and say, actually, this is a massive problem that we need to focus on.
It helps to move the needle on that, in both directions where we're able then to justify our priorities more effectively to those that we're trying to kind of internally sell that, that list of priorities to.
Hugh Seaton: You know, I'm struck as you're describing your own internal assessment process, how that translates into when someone comes to you and says, I've got a product and you should invest in it.
Cause here's how much here's how, how much it's worth. And here's how it's going to change the world. And you're like, I got some math to show you.
Eric Whobrey: Yeah. Yeah. It's an interesting conversation kind of moving to the investment side. I think we do get to come to the table with a little more information on that end. And oftentimes where that conversation really gets interesting is in implementation cost, because a lot of people on the technology and startup side will come in and say, this is a problem that we can solve and it will save your company millions of dollars and the response being well what about how much time it will take to get a 400 person enterprise where everyone is doing it differently? Have you factored that into your cost savings? The answer is usually not really. And it's usually because they're not able to, they don't have that level of information internally to, to an enterprise of our size.
So they can't come to the table with that. And that's where we get to start having really interesting conversations with startups and with with software companies and how that can be factored into their processes and how they can, they can better succeed in selling software to people like us.
Hugh Seaton: Well, I also think that the industry is learning that whereas people may have been a little more naive five years ago. Hopefully at least some people that are crossing your desk, get the fact that data isn't necessarily being generated in a nice, clean way we can feed right into a model or into software, but actually there's going to be some level of change or the other way around that they're saying no, we've included an in an intake process that will streamline and you won't have to change that much. I, I hear both when I talk to people that are building software, myself included, you know, a lot of people are like, let's minimize upfront change as much as humanly possible so that we can still get all the magic done on the backend, but we're not asking a superintendent to, you know, to type a lot in the field, which is, you know, we've been there and done that. Right. And that's what everybody grumbles about when they think about construction technology is, you know, accounting systems where you had to write all this stuff in the field and people are like, what are you doing here?
Eric Whobrey: I think what you said at the start of that is that we're we're learning and the software companies are learning and the construction companies are learning. I believe very strongly that it's a two way street. I think that construction companies have to come to the table, to these software companies with cleaner data and with a better understanding of, of how that is impactful to their business.
Because oftentimes I think, and I think this is improving. I think we're getting better at it. I see peer companies getting better at it. And the industry at large is kind of getting wise to the fact that it's not something the software can just come in and solve. It takes participation from both sides for it to really work the way it's intended.
So coming to the table with a better understanding of our own data really helps to move that along. And it just reduces adoption time and learning time. And even just the, like the level of people willing to adopt it earlier starts to increase because we have a better baseline of education across the business so that people come to the table with different expectations.
Hugh Seaton: Yeah. We're getting there, right?
Eric Whobrey: Yeah. Yeah. There's a long way to go, but it's starting to shift in that direction. And I mean, I'm coming in, you know, I've got four or five years in the construction industry. Some people have, have a lot longer and a lot more experience in this, but in the time I've been in the industry, I've seen it shifting from the expectations of a software company coming in with some magic tool that will solve all our problems, to more of a conversation and more of a collaboration, more integrations, kind of more understanding. Well, I already put this information somewhere in a system that works well for us. So instead of putting it here again, how do I just get it from that place of already put it and that's, that's starting to happen more.
Hugh Seaton: And this is how transformation happens though. It's, it's exactly what you just described, where it would feel slow. You look back you're like we actually changed a lot. It just while we, while it was happening, that were a lot of frustrating meetings where you wish you were further along than you were, but after it, wasn't bill gates that said we overestimate how much we can change in five years and underestimate how much we can change in 10.
I think this, this industry is going through that now.
Eric Whobrey: I completely agree. I see that too. And it is often something that I think it's important to reflect on that I, I find Our leadership and even just our associates across the board there's a tendency to have a short memory on those things that no longer hurt anymore, where all of a sudden it's working really well.
And then the expectation is that it always works that well. And the way it was before is, is quickly forgotten, which I think is great. I don't, I don't want to live in the past pains. But it is nice to be able to reflect on that and see progress despite bumps along the way.
Hugh Seaton: And how do you think what we just described really is an increasing sophistication on the part of contractors in terms of their internal data operations, their kind of software infrastructure, and so on.
How do you think about. A software comes in and you're saying, this is going to have to fit into, it's not a green field anymore. It's going to have to fit into what we have already. So what is your tech stack and how does that affect when you think about bringing in new products?
Eric Whobrey: That's, that's a really good question. And I think again is probably a different answer for every peer in my position at a construction company, which I think is part of the problem of, of being able to adopt these things faster and more widely. We lean pretty heavily on Microsoft both in Azure cloud services and just using Microsoft tools for Excel and word and PowerPoint and outlook and all those fun things.
And what I've tried to do and what my team has tried to do over the years is to really home in on the core tools. So we have a CRM that's used across the business, which has not always been the case. And we have a project management software it's used across the business and we have a financial software that's used across the business.
And so that simplifies some of that conversation around, we need to fit into these things and just having one thing for that core competency, as opposed to saying, well, the way we manage projects differs across every division. So good luck fitting into that. We're starting to get to a level where you can say. I use Procore, can you plug into Procor or I use Salesforce or Pipedrive or something else? Can you fit into that? Like there are structures that exist that are more consistent across our industry now where we can have the conversation at a higher level that says here are the accepted standards and norms in the industry.
Please just work with that. And that there are going to be other pieces that we'd love to have an API access your data. So we can massage it into the weird way that we do it. But as long as those, those core competencies are covered, it unlocks doors in a way that that leads to the rest of those pieces fitting in.
Hugh Seaton: And it feels like that is actually removing a barrier to adoption in some ways. I mean, I'd take Procore as an example, they've done such a good job with their marketplace, that if you're a startup at a certain point, you can professionalize your front end by going through them.
You can access and, and be accessible and trusted by a contractor a lot faster because you've gone through what they need you to go through. And it's feeding into a system that has all this other capability. So you become a you know, a feature set within their Procore instance, as opposed to a standalone thing that I'm not so sure about the security and my God, the sign in is driving me nuts.
It just, it, it doesn't remove the burden for do it for building good software, but it does, I think, make it easier for you to say sure, we'll try it, because we know that it doesn't have to tick quite so many boxes to be useful because Procore's taken care of some of that.
Eric Whobrey: A hundred percent. Yeah. I think that is a big advantage. And I mean, Procore is a frustrating tool to use in some ways, but in a lot of ways, it's way ahead of its competition in that it has a extremely robust API, like there are things that we can't do in Procore. And we would tell our customer success reps all the time. Like, Hey, we really want to do these things.
And sometimes we just hit their API and do it ourselves until they figure it out and it allows us to keep that, that data central to that work being done, but also gives us the flexibility to say to a division or a PM group. If you really need to see it this way we can do that. And we have that capability because Procore has leaned so hard into this like an ecosystem that's working and it's, not just this one app to rule them all.
And I think they have been a leader in that, and you're seeing that happen more and more. If there isn't an API available, it's on a product roadmap.
Hugh Seaton: Yeah, I love that. And it seems that as Procore has matured, they've realized that this puts them in a really good place in the industry, and obviously they've leaned into it, which is fantastic.
So I think, you know, who knows where the future is going to go, but this is definitely I think, a positive development for the industry. And I'm not trying to make a Procore commercial here because I think other companies are following suit. I used to think that some of what Procore did, they obviously saw what Salesforce was doing and said, that's a really good way to be central to an industry without feeling like you need to burn money on, on innovating and iterating every little, every little feature and every little point solution.
Eric Whobrey: Absolutely. I, you see Autodesk has made a huge pivot in this. There are plenty of other businesses that have a foothold in our industry that are, are behaving in this manner, even if they haven't before you're seeing the pivot, which I think you do see that you see that start to happen.
Even if it's just in marketing materials, you start to see people highlight that more as a competency of a software that's popular in the industry.
Hugh Seaton: Well, I mean, just so that we're somewhat even handed, I will say the forge platform is amazing. The things you can do with the viewer. And they've got like a thousand addins.
I mean, it's, it's, there's a lot going on there.
Eric Whobrey: Yeah. Yeah. I love what they're doing with their platform. I think it's absolutely heading in the right direction on the designs. It, you know, it's, it's hard to find a comparable system that is as entrenched as Autodesk is and their tools.
And as innovative as, as they're trying to be, and kind of moving in that direction and really going from a legacy software, not having the luxury of being a startup in the last few years. But shifting a massive business to move in that direction more is it's admirable and it's exciting.
Hugh Seaton: It is. It is. So let's move a little bit from, from where we just were into how you think about you know, putting on your investment hat. So. The startup comes to you and they've been smart enough to integrate with Procore, so there's a couple of boxes ticked that you're in a, you're in an interesting role where you see, you see the reality of a startup more than a kind of standalone investor might.
How does that, how does that help you? How do you kind of use one hand to help the other?
Eric Whobrey: Yeah, it's extremely helpful in the earliest stages. So a lot of times where we're getting involved is pre-seed or seed at the concept stage where they have an MVP. They're trying to get it in front of people.
And we have a lot of kind of baked in insight from the day-to-day work that we're doing, that we can come at it from both a construction architecture, engineering and construction perspective and a technology perspective. To say, this is great, this will work, or this is not great, it could be great. Here's how it could work or this isn't for us.
And it's such a massive industry that there's a lot of opportunity for startups operating a lot of different ways that maybe a national design build firm isn't isn't their audience. And even in telling people, no, we help orient them in a massive industry to see what direction they should, they should direct themselves.
So it's, it's really, really helpful to come into those early conversations where it's conceptual. It's an idea that that has some functionality, but isn't, isn't fully baked yet that we can start to Give the feedback that allows a company to adapt and iterate more quickly. And then we, we have the added benefit of the ability to invest in those companies that helps to align all of our incentives so that We're essentially getting paid for insights, right?
Like not just paying for a tool and then helping make it better. And then all of a sudden this tool is really great for all of our competitors. It's something that we can see growing on both sides of that coin where we make an investment because we believe in it and we see our insights improve the thing, which is good for our operating business.
And also we see that become a better product/market fit. And we can tell all our friends and make that an easier process of kind of reducing the adoption curve overall, ideally for those investments that we do make.
Hugh Seaton: And when you think about investments, so here's a question I haven't always asked other folks, but when you think about your investment, vis-a-vis a, a startup, are you guys typically leading or are you kind of looking to...
Eric Whobrey: No we don't have we're, we're relatively small on, on our assets, under management, if you will. So we are rarely if ever looking to lead around. We often will pass that that responsibility to a partner that we trust. So we have several investors that some are in the construction industry. Some are more generalists that we know. They have invested in, in companies that have gone on to become unicorns or get acquired or, or, you know, have all of the success metrics you'd want to see in a venture capitalist, we have strong relationships with a short list of those people where we can bring an idea to them and say, You should lead this round because we on the product side, see how it'll fit and can get it to the next stage.
We just need you to coach that that founder or those founders to make sure that they do that on the startup side of it really effectively, which is an area that you know, we're not the subject matter experts in venture capital and how to best get from a seed stage to a series a or an a to a B.
But we come with those contacts and those relationships that we, we always partner with those that do know that, so that we, we try to bring that whole package to the, to the idea of the deal.
Hugh Seaton: That's really great. I mean, really understanding where your value add is and saying, you know what, we're not going to grow the internal capability to do all the paperwork and all that stuff where we're going to validate that it makes sense, which is something that investor will struggle with. When I say investor, I mean, just to kind of a pure play investor will struggle with, but at the same time, you, again, you don't want to necessarily stand up the infrastructure that they have really, really. And I'll bet you, that happens a lot.
I mean that that's gotta be a decision that, that corporate venture capital makes all the time is how much... we already know that we provide unique insight and the ability to pilot and just really the ability to kind of kick tires in a way that is tough to do outside of the industry. How much do we want to invest in infrastructure?
How much do we want to really focus on what we're good at?
Eric Whobrey: Yeah, and I think, I think it's happening. Kind of right now in AEC, in architecture, engineering, construction. I think it's it's happening where corporate venture capital arms are being stood up. Startup growth is increasing pretty rapidly and outside capital is coming in pretty rapidly.
So we're seeing this confluence of events where all of those things are actually coming together. Around the same time where those that choose to participate in this, what I would say is a little bit more thoughtful way of approaching venture capital or just capital in startups. They, they get a leg up because everybody is kind of playing to win, not just from can we get this? Can we financially engineer returns on this cash we invest, but really can we build solid businesses that are successful and, and also are providing returns on the financial side.
Hugh Seaton: It makes a lot of sense. So I want to ask, go back to what we talked about earlier, where you, when you're assessing internally, whether something makes sense or not, or how to prioritize.
Are you able to kind of give a startup kind of rough advice on how they should think about presenting and assessing their own? I mean, they're not going to know what you know, internally, but there's, there's some frameworks I'll bet where we could say, well, point one that you made earlier is ask yourself how much the inputs you need are already the way they need to be.
And if you don't know, go ask because I'll bet you, people are complaining about it somewhere.
Eric Whobrey: Oh, absolutely. That there, there is an example. We were approached by like a scheduling software. That was doing a lot of things well, and I was excited about it, but I started asking questions and what I realized was internally, we didn't really have a good handle on the pain and the problem.
So I actually came back to that, that software and said we're not ready for this. We're going to do some, some digging on our end. Here's some like quick hitter things that I can tell you off the bat. That would be really nice. Here are integrations you can make. The, the nomenclature using is a little wonky.
I think you could fix some of that. And then six or eight months later, we came back and we internally had a really good idea of the problem at that point and had done our due diligence internally to say, this is the problem. And, and that group had also come back and said, you know, we, we took what you gave us and did as much as we could.
And we were able to have a really informed conversation at that point that, that made it a much more interesting, much more compelling idea that then when we, when we want to actually pilot it internally, We've done a lot of legwork on not coming immediately with a, Hey everyone. Here's a technology you need to use, but more so coming to an ongoing conversation and saying, I know we've been talking about this problem.
Would you consider trying this as a, as a potential solution that makes it so much easier to not just adopt technology at a construction company, but also from my seat of being on the innovation site at the construction company and investor in the construction startup world. Being able to have those conversations in both directions makes both of those things much more productive.
So it's a strategic win on both sides of the table.
Hugh Seaton: Yeah. I really liked the collaborative approach you're describing and I gotta be honest I see that in, in construction more than I think I've seen that in other industries I've been a part of, where there is this openness. And probably because their innovation teams that are very outward facing and very active, and that, that may be true in other industries, but they tend to have a little bit of a different focus.
And so I think that this, this willingness to, to hear and talk and spend some time with a startup, even if they're not ready to be bought or ready for, you know, ready to be adopted by you. I see that a lot and I think that's a real strength of the industry. This is openness to discussing most of the time. Sometimes it's like, look, no way we ever going to use that. Thanks for your time to talk to this guy. I just feel like there's like, there's a, a broad collaboration that is available. It implies some things about integrity and honesty and you know, being very upfront with where you are, but I think people are first going to let you in, which is, which I think is amazing.
And I think it really is going to have an impact on how fast things move.
Eric Whobrey: I agree. And I think it comes from some level it comes from that being a necessity for the work to get done, no matter how much technology you use or don't use that is, that is a part of the work. So it comes with that.
And that's a nice benefit to those that are looking to collaborate on other things where you can. If you approach it from the right perspective, you have a lot of really smart, expert people talking about a problem and how to solve it in a way that I think is hard to find. I mean, I spent, you know, a career before Arco in advertising and marketing technology.
And I did not encounter that as much where you're sitting around a table of subject matter experts in so many different fields, all really contributing and participating at a high level that, that is really fun. And really interesting.
Hugh Seaton: It's funny, there's this image of the construction person who's just not interested in technology. And you know, I'm sure that exists. Of course it does. But I, my experience has often been the opposite is that people are interested in getting work done. And if it's going to make them safer, faster, more efficient, more predictable, better understand their risks. They're, they're pretty quick to adopt it as long as it's presented in a way that doesn't require they go get PhD in something.
Yeah, I
Eric Whobrey: think I think that there, that that archetype is actually people that just aren't willing to use shitty technology. And I think there's an unfair characterization of people in the industry that are that are Luddites that are just like rejecting it, no matter what. And I think it's a bit of a, a learned behavior that they've been presented with a lot of bad software.
So they have really important jobs that are pressed for time and on extremely tight budgets with extremely low margins. So they don't have a lot of room for error. So if you bring them something, that's not that great then of course, they're going to reject it. And, and I think that's too often been pushed back onto the consumer saying, well, they're just, you know, they're just bullheaded and don't want to do it.
I have seen quite to the contrary, I think some of our. Our fastest adopters of technology and our biggest advocates for innovation are those in the field. They're our superintendents and that's not just, I mean, we have brilliant project managers and project assistants and everyone from top to bottom is committed to innovating and building in the best way possible. But man superintendents are often at the front of the line. When you say, you know, we have an idea of, of doing this a better way. They're, they're usually happy to participate and contribute.
Hugh Seaton: Love that. And I do think you're right that the image is a misconception.
And, you know, one of the things that it's incumbent on someone who's coming to you or someone who's coming to a contractor generally, is to better understand that and better understand not what their software does, but the problems it solves and the pain that it quickly addresses. I think the other thing is that there really, there really isn't a lot of patience for things that take a while to show value.
Eric Whobrey: Yeah. Yeah, I agree. And it's you hit it on the head in that people coming to, looking to solve a problem, not just sell a software are those that are succeeding. I I've in this startup side of things on, on when considering investments, there are some that come to the table and really want to trumpet how powerful their software is and how strongly built it is. And there are some that come to the table and say, we're trying to solve this problem. And we will tear it down and build it again if it solves the problem better. And those are the groups that I gravitate toward, because I think that they're really approaching it from the way that the industry wants to solve these things.
Like we're not building novel technologies for most of the problems we're facing we are applying existing technology to problems that need solving in the whatever nuanced way that construction does things. So it's, it's interesting to see those competing approaches where someone comes in ready to sell software and someone comes in ready to solve problems.
Hugh Seaton: There's an old saying that I want people that are in love with the problem, not the solution. I think that's a great, it's beautiful, Eric. This has been fantastic. Thanks for taking some time.
Eric Whobrey: Yeah, of course. Happy to be here. Thanks Hugh.